The concept of transferring funds or “wiring money” has been practiced for over a century. At today's speed of society, there is a greater and greater need for transferring funds rapidly from one individual to another. Wiring money is particularly useful for individuals that are known as “unbanked,” which means unaffiliated with a financial institution. Migrant workers or foreign nationals, for example, are often unbanked and frequently use wire transfers to send money to other states or other countries for a variety of reasons. For example, these individuals rely on money transfers to help support their families or provide medical or other expenses to those located elsewhere. There are several conventional methods of transferring or wiring money, the most common being a transfer service by Western Union®.
To send money via Western Union®, a customer must travel to Western Union® office or agent location and present case or equivalent funds in the amount to be transferred plus a service fee. The sender is required to fill out a detailed transfer request form for each transaction, which is then automatically or manually entered into the Western Union® system. This is a very labor intensive and time-consuming operation, particularly if the sender makes frequent transfers.
Another system of transferring funds allows customers of a particular financial institution to transfer and receive funds between other account holders electronically. However, this system requires that the individuals have accounts at the financial institution or affiliated institutions, and therefore ignores the large number of unbanked customers that wish to transfer funds.
Yet another system of transferring funds is disclosed in U.S. Pat. No. 5,650,604, which discloses a system and method for transferring funds using automated teller machines (“ATM”) such that the identity of the sender and recipient can be maintained in secret. While the system and methods disclosed in the '604 patent provide convenience to those individuals who wish to keep their identities private, the '604 patent is disadvantageous in at least two respects. First, the '604 patent goes too far in trying to maintain the confidentiality and privacy of the sender and recipient. In particular, neither the sender nor recipient is required to disclose any personal information for identification purposes. Thus, if transfer information such as transaction code or personal identification number (PIN) is intercepted, the transferred funds can be easily stolen. Second, the '604 patent discloses a closed system for transferring funds, which is less convenient for the sender because the sender must locate or access the system of the '604 patent as a separate and distinct operation. Therefore, it is desirable to provide a system and method of transferring funds that is more convenient to the sender and recipient, yet provides security measures in order to prevent theft or interception of the transferred funds.